Financial troubles of Kering deepened in the first quarter, with sales falling short of market expectations as economic challenges mounted—particularly at its flagship brand, Gucci.

The luxury group posted a 14% year-on-year drop in overall revenue, including a steep 25% decline at Gucci. Contributing to the unease are fears of a global economic slowdown, exacerbated by new U.S. tariffs introduced by President Donald.

It contributes around half of Kering’s total revenue and two-thirds of its profits.

“Kering faced a tough start to the year,” said Chairman and CEO François-Henri Pinault. “We are heightening our vigilance to navigate the macroeconomic challenges impacting our industry.”

Footfall across Kering’s portfolio—including brands such as Yves Saint Laurent, Bottega Veneta, and Balenciaga—was weak across most regions, noted CFO Armelle Poulou. Sales in Asia dropped 25%, while Western Europe and North America each saw a 13% decline. The company has closed 25 stores this year, and plans are in place to shutter approximately 50—about a third of which are outlets.

Kering has been under pressure from financial markets following multiple profit warnings as it attempts to revive Gucci, which lost market share. Since the first warning in March 2024, Kering’s stock has plunged more than 60%.

His official start is scheduled for July, which analysts warn may further delay any potential recovery for the brand.

Asked about the recent closure of an exclusive Gucci salon in Los Angeles—designed for ultra-high-net-worth clients by appointment. Only—Poulou clarified that the company remains committed to its strategy of elevating the brand’s luxury positioning.